Association for Public Policy Analysis & Management

In the past few decades, cash transfers have become one of the main social assistance policies used to address poverty and inequality in developing countries. This paper analyzes the impact of one of these cash transfer programs, Tarjeta Uruguay Social, known as TUS. TUS targets households in Uruguay in extreme poverty, providing them with a monthly cash transfer which can be used to purchase food items, cleaning supplies, and hygiene products. Using a rich administrative dataset from 2013-2017, we analyze the impact of the transfer on a variety of life outcomes, including house and living conditions, food insecurity, formal labor market work, and education enrollment of children, amongst others. We implement a fuzzy Regression Discontinuity Design, exploiting a doubling of the transfer to the poorest 30,000 members of the program based on a poverty score. We additionally analyze outcomes for recipients of the transfer in the short, medium and long term, in order to determine how the persistence of benefits impacts outcomes. The results show significant improvements in both household and individual outcomes, specifically regarding dwelling attributes, durable goods, and formal work. Our results highlight the significant impact that the amount of the transfer and duration of the benefit have on the treatment effects.